THE sale of a troubled Amble food factory has fallen through.
In October 2010, Longbenton Foods took over at the Coquet Enterprise Park site, after Northumberland Foods Limited had ceased production in August of last year after suffering cash flow problems.
The Newcastle-based company restarted manufacturing and took on 70 of the 250 former staff, with plans to create further employment opportunities as the business grew.
But Longbenton Foods’ reign was troubled, with the factory closing on a number of occasions and issues around staff payment.
And today (Friday), administrator Begbies Traynor revealed that Longbenton Foods was unable to raise the necessary funds to complete the transfer and the contract has been rescinded.
A statement from Begbies Traynor read: “It is with regret that the administrators of Northumberland Foods Ltd and Amble Assets LLP have finally rescinded the contract to sell the assets of Northumberland Foods Ltd and Amble Assets to Longbenton Foods Ltd.
“Contracts for the sale of Northumberland Foods and Amble Assets were exchanged on October 22 2010 and, following the payment of a non refundable deposit, Longbenton Foods was allowed to occupy the site in Amble and to commence manufacturing.
“However, on the scheduled completion date of November 22 2010, Longbenton Foods was not in funds and was not in a position to complete. In the hope of facilitating the completion of the transaction, the administrators granted a number of extensions to Longbenton Foods in order to allow the company the opportunity of raising the necessary funds to complete. The final extension expired on December 22 2010.
“When Longbenton Foods again failed to raise the necessary funds to complete by December 22, the administrators felt they had no option but to serve a notice to complete, making time of the essence. That notice expired yesterday (January 20 2011), but Longbenton Foods proved still not to be in funds and still not in a position to complete.
“The administrators owe a duty to all creditors to maximise realisations and have, therefore, decided that, given Longbenton Food’s continued inability to raise the necessary funding to complete the transaction, it is appropriate to rescind the contract.
“The intention is now to press ahead with the marketing and sale of the business, including its plant and machinery and the property situated at the Coquet Industrial Estate, Amble.”
“It is hoped that a purchaser can be found who is able to recommence production in Amble and the administrators are eager to talk to any interested party and will work with the council in the hope that the jobs which the business previously provided can be restored.”